Research Topic and Rationale

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Our assignment topic would be E-Commerce in China. We choose China because the potential in China has blossomed over the past years. As we all know, China is the world’s most populous nation with approximately 1.3 billion populations. The number of internet user in China is 59.1 million (Mindrelief, 2007). China is a country considered to have low density population and delivery and distribution problems are common due to under development infrastructure (Mindrelief, 2007). However, the government ‘s strong support has helped China grow massively in using internet (Mindrelief, 2007). The speed of China’s internet infrastructure has been improving rapidly in terms of international bandwidth to the internet and domestic connections between China’s internet backbone providers . This is mainly due to the emergence of competition as the government gave approvals to two new internet backbone providers – UniNet and CNCNET ( Mindrelief , 2007).

Since then, many companies have ventured into click and mortar hybrids to be on par with the trend and keeping close with customers . However there are issues that customers are doubtful of for instance, quality of products, after service or security/ privacy issues.

In 2009, China's e-commerce market totaled 263 billion RMB (approximately $38.5 billion) with growth equivalent to about 105% increase year-on-year (Readwriteweb, 2010). Currently, consumer-to-consumer (C2C) represents the largest segment of China's e-commerce market; however, business-to-consumer (B2C) is increasingly growing in importance due to two trends (Readwriteweb, 2010). Therefore, e-commerce in China is definitely booming fast.
In this assignment, we will we focusing only on a handful of China top websites like Taobao, QQ ,Baidu and few others. We are curious to know how these mega companies succeed.

Therefore, we would like to explore further e-commerce strategy used by top Chinese websites and challenges faced by these websites.

References:


E-commerce opportunities in Modern Business China,http://www.mindrelief.net/e-commerce_opportunities.html, , viewed 27 September 2010

Chinese E-commerce Tops $38.5 billion, What Comes Next? http://www.readwriteweb.com/archives/chinese_e-commerce_tops_385_billion_what_comes_next.php, viewed 27 September, 2010

For discussion: Problems faced by Taobao.com

Even though Taobao is known to be a primary online shopping destination for the largest online population in the world but unfortunately China has been facing problems as well. This includes 4000 fake Taobao websites were found to be closed in July 2010.  According to the APAC (Anti-Phishing Alliance of China) mentioning that the number of phishing website report in the first seven months of 2010 was more than double compared with the entire year of 2009. The most interesting part is that Taobao.com, Tencent’s qq.com and the website of Industrial and Commercial Bank of China which most imitated by phishing websites, accounting for over 90% of the total reports. 

                       How can you tell whether this product is real or fake?

                      This is one of the example taken from the Taobao.com website.

The China Internet information security report published by APAC in March 2010 showed that over 90% Chinese negtizens encountered phishing websites mainly via emails and instant messaging in 2009. This could affect many people and it would increase huge problems about security issues. Therefore, chinese negtizens would not trust the website but also hindered the healthy development of the Internet in China.

China has now becoming so serious and took action for those users who sell fake websites will be terminated. Taobao.com’s move comes after a shop owner registered on the website was found selling fake products of famous brands such as LV and Dunhill. Those fake products will be confiscated by the commerce department of Haidian District, Beijing.  Till now, the case has been transferred for further investigation. According to this program, if products sold through Taobao.com have quality problems, the website will help the sellers to return the payments for the goods to consumers in advance, shortening the period of waiting for the returned money.

                                                                 
                                                                 FAKE LV WATCH

Taobao.com has just released a blacklist of fake good sellers. This shows that many highly ranked sellers are cheating buyers by taking advantage of their high credit index.Taobao.com has already close the accounts of selected sellers with many netizens posting messages in online forums that they do not trust this website anymore. It would make people to think twice when they want to do online shopping. When posting goods online in Taobao.com website, sellers and buyers are ranked based on their trustworthiness and ability to deliver as advertised products. A person surnamed He was mentioning that sellers just use different members names to make good comment about themselves in order to obtain high ranking.

Apart from that, Taobao.com is enforcing new rules to punish illegal online behavior. The first rule states that the company will remove any counterfeit goods from its website after receiving complaint letters from brand owners. The second rule will be owners of online stores that are closed will not be allowed to open new stores at Taobao.com for 3-5 years. Lastly, the new rule about setting a price limit for each kind of good saying that goods that are priced very cheap will be placed under observation.

After reading this, would you still consider yourself buying goods online from Taobao.com website? If there is any information related to this website, please comment back. Thanks


List of references:

China tech news.com 2006, Taobao.com announces fake goods blacklist, viewed 24 September 2010.http://www.chinatechnews.com/2006/07/31/4184-taobaocom-announces-fake-goods-blacklist

China tech news.com 2006, Taobao.com Chinese users who sell fake products will be terminated http://www.chinatechnews.com/2009/02/10/8742-taobaocom-chinese-users-who-sell-fake-products-will-be-terminated

Research Objectives

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Hello everyone!


After doing extensive research earlier on and spending time on our blog postings mainly on a few prominent Chinese websites ,we have decided to come up with 3 main research objectives

They are:

1)What are the strategies used to make top chinese websites so successful?

2 We also want to know the success factors that led these websites to major success

3)Lastly, what are the issues and problems faced by top chinese websites

We hope all of you can contribute your thoughts to our topic. Thank you!

Have a good weekend :)


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For discussion: China prefer to buy luxury goods online

I have picked up an interesting topic that is related to the topic that we have chosen. It was taken from the Borneo Post dated 13 September 2010 that was just recently happening in China. Well, the Chinese e commerce market is still growing rapidly as Chinese consumers till now still prefer to shop online. E commerce retail sales in China have more than doubled in the first half of 2010 compared to the same period a year earlier. The total value of sales in the first half of 2010 is thought to be around 211.8 billion yuan equivalent to RM 7.8 billion, based on the research report on China’s internet market that was released by Alibaba.

Nowadays, young Chinese teens are driving the booming e-commerce internet retail industry which estimated to have a total yearly turnover of 3.8 trillion yuan (441.2billion) by the Ministry of Commerce. Apart from that the Taobao – Chinese online auction site found that majority customers who are interested in these sorts of things would be at the age of 21 and 30. Most of them are fanatic about Louis Vuitton, Armani etc.

Chinese between 21-30 are so addicted into online shopping

For Discussion:The Almighty QQ

Instant messaging is a popular trend around the world including Malaysia. We use service like MSN Mesengger, Yahoo Chat, Google chat mainly to socialise with friends and family.

According to China-online-marketing ( china- online -marketing, 2010)in China, QQ is the biggest instant messaging service provider.It is the third largest in the world after after MSN and Yahoo (Telco 2.0, 2009).Each QQ user join more than 10 user group. QQ is divided into different categories for instance by hobbies, region et cetera.QQ group member can gruoup chat on the same chat room or private chat.

Tecent QQ is internet based instant messaging platform.its prominent service include basic online com munication,including text messaging, video and voice chat as well as online offline file transfer ( Tecent. com, 2010).



Product/service differentiation: QQ tries to be unique from other instant messaging competitors and differentiate their service. Below are a few examples

QQ enterprise
Already pioneer in instant messaging, QQ has diverse its services to enterprise by offering to connect business entities with massive QQ user base.It helps manage entities by providing secure and effective communication platform and providing entities with CRM best practices to achieve customer service excellence (Tecent.com, 2010).

3G.QQ. com
it's service enable customers to live broadcast of major sports events on their phones anywhere, anytime.

QQshow
QQshow is a virtual avatar system and a digital fashion platform invirtual world.




QQ also encourage E-commerce trading and use safe and convenient payment methods with state of the art technology for example Paipai.com and Tenpay.com

Paipai.com consists of a number of large channel. It provides feature products and services,personalised customisation, brand zone and gift zone.

Tenpay.com
Tenpay is devoted to customers by giving safe and secure online payment.it focused on building integrated platform and give value to customers.Tenpay provides individual users with complete and advanced account services, including collection, payment, trading inquiry management, credit agency, and has launched a series of personalized account applications. Meanwhile, Tenpay also provides corporate users with a professional payment clearing platform and many powerful value added services.

According to Telco 2.0 ( Telco 2.0, 2009),QQ's success are based on certain elements, such as

1) Creativity and personalisation
QQ see the need for personalisation and constantly offering new application

2) Participation
Users get to participate actively by extending the digital business into the physical world (hybridisation) say, by selling tickets to live performances through your music streaming service or vice versa

3)Peer Group
QQ encourages peer grouping by dividing users into different groups

At this point, it is safe to say QQ is successful in winning customers mainly due to convinience, user friendlyness, and custumisation based on user's needs.

Therefore, QQ users incresase every year



Thank you for reading! Please share your instant messaging experinces and how you can relate to QQ :)





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References:
QQ: Quite Quality, http://www.telco2.net/blog/2009/03/qq_quite_quality.html, viewed 13September 2010


QQ:China's monster Facebook, http://www.telco2research.com/articles/AN_QQ-China-Facebook-coming_Summary, viewed 13 september 2010

Tencent:The aim to create value for our user base,http://www.tencent.com/en-us/index.shtml,viewed 13September 2010


QQ marketing:Reaching 340 million QQ users,http://www.china-online-marketing.com/blog/qq-marketing/qq-marketing-reaching-340-million-qq-users/, viewed 13 September 2010

SINA

What is SINA all about ???


SINA is an online media company and MVAS provider in the People’s Republic of China and the global Chinese communities. With a branded, wide network of localized websites targeting Greater China and overseas Chinese, the Company actually provides services through five business lines which includes SINA.com (online news and content), SINA Mobile (MVAS), SINA Community (Web 2.0-based services and games), SINA.net (search and enterprise services) and SINA E-Commerce (online shopping). Together with all these business lines provide an array of services including region-focused online portals, MVAS, search and directory, interest-based and community-building channels, free and premium email, blog services, audio and video streaming, game community services, classified listings, fee-based services, e-commerce and so forth. In my opinion, it offers a wider potential of choices for the consumers to choose from these options that mentioned above. Furthermore, the company also generates the majority of its revenues through online advertising and MVAS offerings.



In 2008, its main focus of SINA is to build out multimedia, multi-devices and community-building strategy, integrating multimedia and interactive features into its information and entertainment platform, injecting more social-networking elements into its user-generated and community-based product portfolio as well as continuing to invest in its WAP portal business. In the area of news coverage, the Company further solidified its leading position in China’s Internet space by delivering multimedia, interactive coverage on several major events, including UEFA Euro 2008, the Sichuan earthquake and the 2008 Beijing Olympics successfully. Only the government will have full control over this online traffic ranking site in China, and ranked to be No. 1 in daily unique visitors in news, forums etc.

In addition, SINA could also describe as an online brand advertising property in China. SINA employs a multi-pronged sales strategy that targets both short-term revenue opportunities such as banner advertising campaigns, as well as to maintain longer-term, higher-value contracts that include integrated marketing packages. The Company’s advertising product offerings consist of banner, button, text-link advertisements that appear on pages within the SINA network, channel and promotional sponsorships, and lastly advertising campaign design and management services.

Well, SINA’s portal network consists of four destination websites dedicated to its users across the globe which are Mainland China (www.sina.com.cn), Taiwan (www.sina.com.tw), Hong Kong (www.sina.com.hk), and in North America (www.sina.com). Each destination site consists of Chinese-language news and content organized into interest-based channels. The sites offer extensive community and communication services and also sophisticated web navigation capability through SINA search and directory services.

There are numerous varieties of channels that most Chinese people watch that are SINA news, SINA sports, SINA music and videos, SINA movies.

HAPPY READING .... HOPE YOU ENJOY ! :D
Reference:

Sina website (1996-2009), You are the one, viewed 13 September 2010
http://corp.sina.com.cn/eng/sina_index_eng.htm

For Discussion:China 2.0: The Rise of Digital Superpower

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Hi folks!
Please watch the video above on
chinese people perception on pioneer websites Baidu, QQ , and Taobao.

To summarise, QQ is mainly for messagging and gaming.Tecents, the company owning QQ also recently have indirect stake in Facebook.Its service has expanded by sharing stake in Zynga ( the company owning Farmville) on Facebook. This shows China is also influencing the global gaming trend.

People shop on Taobao because of wide variety of things, convenient and easy payment.Taobao also have partnership with Yahoo Japan thus, showing growing overseas influence of China 2.0.

A lot of people use Baidu for free music streaming.

While these three companies are growing strong, they should be aware of growing competitors eg. Youku.com ( video sharing site)





or new social networking sites.

Overall,based on the video the people of China really support shopping on local websites and thus their booming economic power.

Thank you for reading! And dont forget to give your thoughts :)


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Reference:
China 2.0: Rise of Digital Superpower,http://www.youtube.com/watch?v=BvDVgtekW2A, viewed 9 September 2010

TAOBAO.com

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Taobao.com, is known to be the popular online destination site for shopping, socialiazing and information-sharing. This site will be launching a new platform for both major domestic and overseas consumer product makers and retailers in order to sell directly to Chinese buyers. The new system to complement the existing public site has been established to fight back with other competitors such asWal-Mart and B&Q.

The Taobao Shopping Mall is going to be online in March, and will charge retailers based on their transaction volume. The Website, which has beat eBay Inc in China for its free service, is trying to be profitable and pave the way through for the public."We want to make it a source of quality products for buyers of good taste, like traditional department stores, with guaranteed quality, good compensation policies and more convenient payment methods," said the officer of Taobao.
It mentioned in the news that the target is to have about 700 stores available to buyers for the launch of mall.taobao.com, which will be parallel to Taobao's C2C business that is free to all users. Companies have to pay five percent of their transaction value to Taobao if their outlet fails to sell more than one million Yuan (US$133,333) a year. Discounted commission is provided for bigger sellers. Furthermore, they have to pay a 5,000 to 15,000 Yuan one-time deposit for Taobao to compensate shoppers if shoppers make a complaint.
Apart from that, in other news article, mentioned that Taobao.com is expanding its e-commerce model to include products and services provided by major manufacturers and retailers.

"While American B2C models have failed to succeed in China, Taobao's model will make B2C a reality in China," said Toto Sun, Taobao.com's General Manager. "Because we are simply connecting large sellers to consumers, rather than taking possession of the goods and serving as a middleman, we are offering a solution that will benefit both manufacturers and consumers in China."

According to Sun,  he mentioned that "Taobao's growth has been based on four pillars - trust and safety, the AliPay payment system, search and an active marketplace," With Taobao's trusted e-commerce community which leads to the market, it would be the ideal channel for both manufacturers and retailers to reach out millions of customers there and expand widely as every people in China loves to do online shopping. With this, it will make China market grow more successfully. Furthermore, it will also increase the number of online shopping each year when people change their attitude to purchase goods online.


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References:

Shanghai Daily 2008, Taobao.com launches online shopping mall, viewed 7 September 2010

http://www.china.org.cn/english/business/239421.htm

Stone 2008, Taobao.com launches B2C services, viewed 7 September 2010

http://resources.alibaba.com/article/10059/Taobao_com_Launches_B2C_Services.htm

Hellloooo

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my next post will be about top websites which is used in China. Actually there are 100 of them but I am just going to pick the most important and daily use by chinese people :) Have a good weekend and Happy Hari Raya to those people who are celebrating it !!


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Cheers :D

For Discussion:The power of China

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China has become more and more tech-savvy having their own giant search engine eg.
Baidu


instant messaging service provider eg. QQ similar to ICQ

shopping website similar to E-bay, Taobao.com owned by Alibaba Group mentioned earlier.

Unlike the rest of the rest of the world that depended on the west ( America) for Google, Yahoo, Wikipedia, E-bay, et cetera, China has developed many of their own powerful websites as they have such a big population. This has solve many problems like language, communication, and trust problems for their own people.

China has turn into powerhouse for internet. Hence,there are so much potential in China's E-commerce to grow since their internet developement is growing more competetive.


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Thank you for reading!


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Description about China

Dear friends,


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Let me share with you all, the history about China. It is interesting to know that China has now becoming the leading civilization, outpacing the rest of the world in the arts and sciences, however in the 19th and early 20th centuries, the country was beset by civil unrest, major famines, military defeats, and foreign occupation. After World War II, the Communists under MAO Zedong established an autocratic socialist system, while ensuring China's sovereignty, imposed strict controls over everyday life and cost the lives of millions of people. After 1978, MAO's successor DENG Xiaoping and other leaders focused on market-oriented economic development. In 2000, output had quadrupled. In the modern era, living standards have been improved dramatically and the room for personal choice has expanded, yet political controls remain tight.


Where as in the 1950s, change to economic policies in Taiwan transformed the island into a technology-oriented industrialized developed economy after a period of high growth rates and rapid industrialization. In mainland China, in the year 1970s, will be known as the Four Modernizations modernized the agriculture, industry, technology and defense, vastly raising living standards, and making the PRC one of the great powers.

The History of China

                              

Geography and Climate

• Location:

Eastern Asia, bordering the East China Sea, Korea Bay and Yellow Sea and South China Sea between North Korea and Vietnam.

• World fourth largest country after Russia, Canada and US

• The climate in China varies greatly as in the Northern zone (Beijing) has summer daytime temperatures of more than 30 degree Celsius. The Central Zone (Shanghai) has a temperate continental climate with very hot weathers and very cold winters.


1) http://www.youtube.com/watch?v=Gezjlo4FFpc&feature=related

This video I got it from youtube tells us about the story of Silkroad in China which makes China so famous and be the number 1 in the most developing countries compared to other countries. Hope you enjoy ! :)

2) http://www.youtube.com/watch?v=aZOMnEHHpEg&feature=related
 This video shows about China growing Power, Progress and Prosperity


 People:


Population:

1,338,612,968 (July 2010)

Ethnic group:

Han Chinese 91.5%, Zhuang, Manchu, Hui, Miao, Mongol, Tibetan, Buyi, Dong,

Korean etc

Language:

Mandarin, (Putonghua based on Beijing dialect) Yue (Cantonese)

Wu (Shanghainese), Hakka dilalect and other minority languages


Political parties and leaders:

Chinese Communist Party or CCP (Hu Jintao); eight registered small parties controlled by CCP



Share your thoughts and view :) There is more to come !!~ XD



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References:
CIA the World Factbook, China,
https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html

For Discussion:The Explosion Of E-Commerce in China

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Our blog focus is on China and the country’s migration to E-Commerce. According to Olsen (2010) article entitled China’s Migration to E-Commerce on Forbes.com, The China Internet Network Information Center stated that the number of internet users in China jumped 28.9% in 2009 to 384 milllion! On top of that China’s online shopping sales rose to $ 36.6 billion. The main reason for this success penetration to E-Commerce is that retailers are able to make customers feel more comfortable while doing online businesses. China’s online shoppers are youngsters mainly around 18 to 35 years of age. Like many other countries including Malaysia, China customers encounter trust problems while doing online transactions. Thanks to new third party payment system called Alipay (owned by Alibaba), the system is able to resolve those issues. Therefore, now customers feel safe while making online payments :)

Moreover, the success of companies such as Alibaba and Taobao have driven many companies in China to be extremely keen on the internet industry and will be explored deeper in later postings. Have anyone of you tried exloring Alibaba or other popular China websites? If yes, why do you think these companies are so successful? Let us know and drop in some comments :)

Thank you friends!

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Reference:
Olsen,R., 2010, China’s Migration to E-Commerce , http://www.forbes.com/2010/01/18/china-internet-commerce-markets-equities-alibaba.html, viewed 4 September , 2010

Introduction 2

Hello!


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It's Edith here. I am a final year student currently and majoring in Accounting. I like sports and music.This is my first time blogging and so is Fiona's and so this project is rather exciting! Our blog topic is on E-Commerce in China. I hope to learn many new things from each other through our blog postings. Your comments are greatly appreciated. Keep them coming. Thanks :)


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Introduction 1

Those who do not know me, .... therefore it is my great pleasure to introduce myself. My name is Fiona Ting Siew Boh and my nickname which my friends called me "FIFI". I am currently studying Bachelor of Business (Marketing) in my final year. I love to play with my dogs and read novels, cooking books and japanese mangas during my free time. So far, movies I love to watch would be Toy Story 3, Tekken and also Karate Kid :):) This is just a simple introduction from me.. If you wanna know more about me, ask me ... HAHAHA

Nice to meet you all of you :)

Greetings

Dear all,



Welcome to Edith and Fiona's blog... We will be sharing with you all about e commerce in China as we feel it is an interesting topic to explore and to have a deep insight information about China itself. Before we move on further, this is our first time to do blogging so we hope that our friends around us would assist us about designing blogging etc. We would be very much appreciated if you help us on it and gives us some feedback on anything that would be useful

Feel free to explore our blog as sharing works both ways, so if you find what you will be viewing interesting, please share with your friends and gives us more contribution and comments.  

A big thank you to everyone